Around 900 UK staff have lost their jobs at Tata Steel, with nearly 600 leaving its Port Talbot operations in Wales, the company has said.

Workers were told on Friday morning that their jobs were being cut in the latest round of cost savings by the loss-making steel maker. Bosses also plan to close 12 steel finishing and processing sites across the country.

Karl Koehler, chief executive of Tata Steel's European operations said: "Today's proposals are part of a strategy to transform ourselves into an 'all-weather' steel producer capable of succeeding in difficult economic conditions."

The majority of the 580 jobs to go in Port Talbot, which employs 5,000 people, will be management and administrative positions, while a further 155 jobs are to be lost in Yorkshire, 120 in the West Midlands and 30 in Teesside.

Shift levels at the company's Rotherham and Hartlepool plants will also be reduced as demand for pipelines and bars diminishes.

However, the company, which employs 19,000 staff in the UK, will create 120 new jobs when a hot strip rolling mill opens at Llanwern, and one of two blast furnaces at Port Talbot will restart in the new year as part of a £250m investment plan.

Unite union Wales secretary Andy Richards said: "Today's announcement of job losses at Tata is devastating news for both the employees involved and the local community, especially coming so close to Christmas.

"It is a dark day for Welsh workers and for the steel industry in Wales – another twist in the knife of decimation started by Thatcher over 30 years ago."

Michael Leahy, general secretary of the trade union Community, said: "Sadly, these potential job losses are symptomatic of the continuing failure of the government's economic policy and yet another reason why we are calling on the British government to take urgent action to stimulate economic growth and help revive the manufacturing sector."

He added: "This announcement comes after a four-year long downturn in the UK and European steel industry, where the fall in UK steel demand has been steeper than in any other major European economy. This is why we need faster investment in infrastructure programmes and community benefit clauses in UK procurement, just as France and Germany do to support their own manufacturing industry."

Earlier this month the business swung to a loss of $67m (£42m) for the quarter, due to falling demand for steel in Europe, which accounts for two-thirds of its 28m tonne capacity.

The company said demand has fallen 25% since 2007 and was forecast to fall by a further 10% this year.